USD/JPY Price Forecast – US Dollar Grinding Higher Into Resistance
US dollar has dipped on Thursday, but then turned around as the 50 day EMA is trying to offer support. We are still seen a lot of pressure so I am not buying.
The US dollar has initially pulled back a against the Japanese yen before turning around again on Thursday. That being said, we are between the 50 and the 200 day EMA indicators, which typically means trouble. Furthermore, the ¥107.50 level continues to be an area worth watching. After all, the market has seen a lot of selling pressure in that area and we must remember that the Federal Reserve continues to flood the markets with greenbacks. It is only a matter of time before the idea of resistance comes back into play, and therefore we sell off.
USD/JPY Video 14.08.20
However, this pair is a little bit different in the fact that the Federal Reserve is loose, while the competing central bank is just as bad. Because of this, this could be a very choppy situation. It is worth noting that the Japanese yen is losing strength against several other currencies at the moment, so that could continue to play happy care.
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Nonetheless, it is not until we break above the 200 day EMA which is above the ¥107.50 level that I would consider buying. Right now, I am looking for signs of exhaustion that I can sell but have only had a couple of short-term trades set up. I would look for huge moves at this point, the longer-term the US dollar certainly seems to be in trouble. Furthermore, if we get some type of major “risk off” type of macro event, which let us face it here – that could happen, we could see the Japanese yen strength in any way.
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